Nov 29

Free 24 hour Solo 401(k) Plan Establishment Expediting Service

IRA Financial Group, the leading provider of IRS compliant solo 401(k) Plans, announces the offering of a free year-end 24 hour turnaround expediting service for all its new solo 401k plan clients. The new year-end free 24 hour turnaround expediting service will be offered to allow self-employed individuals or small business owners the ability to adopt a solo 401(k) plan for their business quickly by December 31. “In order for a self-employed individual to take advantage of the attractive deferral features inherent in the solo 401(k) plan, the plan needs to be established by December 31,“ stated Maria Ritsi, a senior paralegal with the IRA Financial Group. “We are excited to offer this year-end free expedited solo 401(k) tax establishment service free of charge for all our new clients, “ stated Adam Bergman, a tax attorney with the IRA Financial Group.

The IRA Financial Group was founded by a group of top law firm tax and ERISA lawyers who have worked at some of the largest law firms in the United States, such as White & Case LLP, Dewey & LeBoeuf LLP, and Thelen LLP. With our work experience at some of the largest law firms in the country, our attorneys legal and tax knowledge in this area is unmatched. Each person looking to start a solo 401(k) Plan will be provided with the opportunity to establish their solo 401(k) plan within 24 hours for no additional service fee as well as receive a free tax consultation with a retirement tax specialist in order to explore the most tax advantageous year-end tax planning opportunities.

A solo 401K Plan offers a self employed business owner the ability to use retirement funds to make almost any type of investment, including real estate, tax liens, private businesses, precious metals, and foreign currency on their own without requiring custodian consent tax-free! In addition, an individual 401K Plan will allow a plan participant the ability to make high contribution limits (up to $55,500) as well as borrow up to $50,000 for any purpose. In order to make annual tax deductible or after-tax contributions, the solo 401(k) Plan has to be established prior to December 31. Accordingly, it is very common for small business owners with no employees to start focusing on year-end tax planning towards the end of the year. “We are excited about providing a free platform to help small business owners determine the most tax efficient retirement solution based on each individual’s financial, retirement, and investment needs,” stated Mr. Bergman.

IRA Financial Group will take care of setting up the entire Solo 401k Plan. The whole process can be handled by phone, email, fax, or mail and typically takes just several days to complete. Our 401k experts and tax and ERISA attorneys are on site greatly reducing the set-up time and cost. Most importantly, each client of the IRA Financial Group is assigned a tax attorney to help with the establishment of the Solo 401k Plan.

To learn more about the IRA Financial Group please visit our website at or call 800-472-0646.

Nov 28

Getting the Most of Your 401k Match

Most experts agree that the best first step in retirement planning is getting the full match from your employer-sponsored 401k plan.  Now that the recession is, well, receding, more employers are offering a match to contributions employees make to his or her 401k plan.  Here, we’ll show you how much you need to contribute to get the max.  Note that the max you can contribute to a 401k for 2012 is $17,000 ($22,500 if you are age 50 or higher).  Next year, that max goes up $500.

We’ll do this in the simplest way possible, so even those that aren’t great at math can follow along.  Most employers will cap their match at 6% of the employee’s salary.  For example, if you earn $100,000 per year, the most an employer will match is $6,000.  Furthermore, the employer will match only a certain percentage of the contributions.  So if that percentage is 50% and you contribute $10,000 per year, the employer will match $5,000.  However, if you were to contribute $20,000, normally that would mean a $10,000 match, but since the employer caps it at 6% of your salary, the match would only be $6,000.  To get the full match only, you would need to contribute $12,000 in this example.

So why would you want the full match exactly, not more or less?  First, you don’t want less than the full match since that’s essentially free money!  The more money you save now, the more you’ll have at retirement.  So why not invest more?  We believe that employee-sponsored 401k plans are not the best retirement options around.  For example, a traditional or Roth IRA offers a wider range of investment options.  Get with your financial advisor to see what’s the best plan for you.

Here is one last example that should break everything down for you:

Bob, who is 45 years old, makes $150,000 per year and has set a budget of $25,000 to invest in retirement options.  His employer will match up to 6% of his salary and 50% of his contribution.  6% of $150,000 is $9,000, so that is the max Bob could receive in free money.  Since his employer matches half his contribution, Bob would need to contribute $18,000 to get the full match, but that is $1,000 more than he’s allowed to contribute.  Therefore, he would contribute the max of $17,000 and receive a match of $8,500, which breaks down to about $327 per week.  He now has $8,000 to invest in other retirement options.

Hope this little math lesson has helped clear up some questions you might have about your employee-sponsored 401k plan.  Contact a tax expert at the IRA Financial Group who will help determine what you should do next.

Nov 27

Year End Tax Considerations

There is a good article over at that talks about income tax considerations to think about as the end of the year approaches.  Everyone is worried about the so-called “fiscal cliff”, the end of the Bush-era tax cuts and Obamacare.  Assuming no Congressional action, here’s what will happen:

  • The “Bush tax cuts” of 2001, 2003, and 2010 (TRA extension under Obama) will expire on December 31, raising all tax rates.  For example, the top income tax rate will increase from 35% to 39.6%.  Capital gains rates would top out at 20% from the current 15% (plus the Obamacare surtax as referenced below).
  • Dividend income would be taxed as ordinary income, subject to the maximum rate of 39.6%, up from the current maximum rate of 15% for qualified dividends (plus the Obamacare surtax as referenced below).
  • The employee portion of the Social Security tax rate will return to 6.2% from the 4.2% rate of the past two years (This was passed as part of the TRA of 2010.)
  • Elimination of the Alternative Minimum Tax (AMT) “patch” would cause the AMT to apply to millions of additional taxpayers.
  • Introduction of a new 3.8% Obamacare surtax on investment income, applying to married taxpayers with incomes in excess of $250,000, or single individuals with income in excess of $200,000.
  • An additional 0.9% Medicare tax on wages and self-employment income; that is, increases to the employee-paid Medicare tax from 1.45% to 2.35% for wages over the threshold amounts of $200,000/$250,000.
  • The revival of the so-called “Pease limitation” that generally limits the available tax deductions for high income individuals.

Here are some strategies you may want to consider:  Minimize the impact of the Obamacare surtax which is 3.8%.  Advisers have been talking to clients about lowering “net investment income” or MAGI or both which is used to determine how much you are taxed.

Next, long term capital gains are set to increase from the top rate of 15% to 20% (plus the Obamacare tax if you make more than $200,000.  Many are triggering and incurring capital gains for tax reason, thought this may not be the best idea.

Also, you may want to accelerate the receipt of ordinary income.  This is rather hard unless you own a business.  “Employees with non-qualified stocks options may want to consider an early exercise to recognize ordinary income at this year’s lower tax rates,” says Forbes contributor Rob Clarfeld.  Moreover, if you have a traditional IRA, you may want to convert to a Roth IRA to get today’s lower tax rate.

Finally, you can change your asset allocation.  Higher tax on dividends have people focused on moving away from these stocks, though it’s not the best move.  Holding off selling securities at a loss is another move that’s very risky.

Read the entire article here to learn more about these strategies.  Of course, you should talk with a professional to see what will work best for your situation.  Contact the IRA Financial Group today to see what’s in your best interest.

Nov 26

IRA Financial Group Introduces the Individual 401k LLC Solution

IRA Financial Group, the leading provider of individual 401(k) Plans, announces the introduction of the “checkbook control” individual LLC solution. With IRA Financial Group’s individual 401k Plan, also known as a solo 401K plan, the individual plan participant of the individual 401k Plan, will have “checkbook control” over the retirement funds allowing one to make 401k Plan investments by simply writing a check. When making an investment with IRA Financial Group’s individual 401k Plan, one has the option of making the investment directly via the plan, or, alternatively, one can invest the funds in an entity, such as an LLC, which will be owned 100% by the individual 401k plan to make the investment. “Using a individual 401(k) LLC to make investments, such as real estate offers a number of tax and limited liability advantages when making investment using retirement funds,” stated, Adam Bergman, a tax attorney with the IRA Financial Group.

The LLC offers its owners, in the case of an individual 401k Plan, limited liability protection. Owners and members of the LLC are not liable for the debts, obligations, and liabilities of the LLC. Since, in most cases, ones retirement account may be their most valuable asset, protecting them from attack from creditors is essential. By using an LLC, one would be able to shield their 401k assets held outside the LLC from creditor attack.

Along with limited liability protection, the LLC offers its owner(s) privacy, confidentiality, and discretion when making investments. Because most states do not require the name of the member(s) of the LLC to be made publicly available when forming an LLC, by using an LLC, the 401k Plan participant can shield his or her identity when making an investment. Whereas, if the individual 401k Plan made the investment directly (without using an LLC), the individual 401k Plan’s name would be included on all the real estate and title related documents and would be publicly available. In other words, the name of the individual 401(k) Plan, which typically involves the name of the business or sole proprietorship adopting the Plan would be included on all public documents, whereas, in the case of an LLC, only the name of the LLC would be included.

The IRA Financial Group was founded by a group of top law firm tax and ERISA lawyers who have worked at some of the largest law firms in the United States, such as White & Case LLP, Dewey & LeBoeuf LLP, and Thelen LLP.

IRA Financial Group is the market’s leading provider of self-directed individual 401(k) plans. IRA Financial Group has helped thousands of clients take back control over their retirement funds while gaining the ability to invest in almost any type of investment, including real estate without custodian consent.

To learn more about the IRA Financial Group please visit our website at or call 800-472-0646.  Also, follow us on Twitter: @IRAFG & @Bergman401k

Nov 20

Sandy Victims Can Take Hardship Distributions

The IRS on Friday announced that it will allow taxpayers who have been adversely affected by Hurricane Sandy to take hardship distributions or loans from their retirement plans (Announcement 2012-44).  To qualify under the announcement, hardship distributions made on account of a hardship resulting from Hurricane Sandy must be made on or after October 26, 2012 and no later than February 1, 2013.

Under the relief provisions announced, a qualified employer plan will not be treated as failing to satisfy any requirement under the Code or regulations merely because the plan makes a loan or a hardship distribution for a need arising from Hurricane Sandy to an employee or former employee whose principle residence on October 26, 2012 was located in one of the counties or Tribal Nations that have been identified as covered disaster areas because of the devastation caused by Hurricane Sandy.  The relief also applies to employees whose place of employment was in one of these counties or Tribal Nations on that date or whose lineal ascendant, dependent or spouse had a principle residence or place of employment in one of the counties or Tribal Nations on that date.

The IRS says plan administrators may rely on representations from the employee or former employee as to the need for and amount of a hardship distribution (unless the plan administrator has actual knowledge to the contrary), and the distribution will be treated as a hardship distribution for all purposes under the Code and regulations.

The relief applies to any Sec. 401(a), 403(a) or 403(b) plan that could, if it contained enabling language, make hardship distributions.  It also applies to any Sec, 457(b) plan maintained by an eligible employer and any hardship arising from Hurricane Sandy will be treated as an “unforeseeable emergency” for purposes of distributions from such plans.

The amount available from hardship distributions is limited to the maximum amount that would be permitted to be available for a hardship distribution from the plan under the Code and regulations.  However, the relief provided by the announcement applies to any hardship of the employee, not just the types enumerated in the regulations and no post-distribution restrictions are required.

To make a loan or hardship distribution, a qualified employer plan that does not provide for them must be amended to provide for loans or hardship distributions no later than the end of the first plan year beginning after December 31, 2012.

Under the announcement, a retirement plan will not be treated as failing to follow procedural requirements for plan loans (in the case of retirement plans other than IRAs) or distributions (in the case of all retirement plans, including IRAs) imposed by the terms plan merely because those requirement are disregarded for any period beginning on or after October 26, 2012 and continuing through February 1, 2013 with respect to distributions to individuals described above, provided the plan administrator (or financial institution in the case of distributions from IRAs) makes a good-faith diligent effort under the circumstances to comply with those requirements.  However, as soon as practicable, the plan administrator (or financial institution in the case of IRAs) must make reasonable attempt to assemble any forgone documentation.


For any questions, contact the tax experts at the IRA Financial Group and don’t forget to follow us on Twitter!  @Bergman401k


Nov 17

Boosting Your Retirement Plan at 50

The markets are steadily gaining, retirement funds are growing and the financial crisis/economy is bound to improve.  If you’re 50+ years old, you’re nearing retirement…hopefully.  The questions are, given your current financial situation and retirement funds, when can you retire and is there anything you can do to make that sooner rather than later?

You should start by checking your current balances and decide when you want to retire and how much do you need to do so comfortably.  There are plenty of tools out there to help you choose how much and where to save your money.  Contact your financial advisor or check your plan’s website.  Then it’s time to start putting that plan in action.

While you can adjust your current retirement plan to go for bigger gains, this comes with more risk.  Another risky option is to go outside your plan and invest looking for a home run.  Try to stick with your current plan to increase investments.

The cap for contributions for 401k plans and the like is $17,000 for 2012 ($500 more nest year).  This might not be enough to reach your goals, especially if you are just starting to save or have small plan balances.  However, if you’re age 50 or older you can make additional “catch-up” contributions of up to $5,500.  While that doesn’t sound like a whole lot, if you contribute that each year for 15 years and earn 5%, that turns into $118,000 ($63,000 more for five years after that).

Depending on your needs, this course of action might not be needed or might not be enough to help you reach your retirement goals.  Consult a professional to see how you can reach those goals.  The tax experts at the IRA Financial Group are waiting to hear from you.  Give us a call at 800.472.0646 today!  Don’t forget to follow us on twitter too!  @Bergman401k

Nov 15

Small Business 401k Reform

“Although 90% or more of large employers offer 401(k) plans, only about a third of small employers do. And the fact is most Americans work for small businesses. So the key to expanding 401(k) participation is to make it more attractive to small businesses to offer a retirement savings plan. The biggest stumbling blocks are cost, administrative hassles and fiduciary responsibility—hurdles that many small businesses can’t overcome”, says Mary Beth Franklin at

There’s talk about banding small businesses together in a 401k plan called a Multiple Employer Plan (MEP).  This type of plan would lower costs, have professional management and would shift fiduciary responsibilities from the plan sponsor to the administrator.  It would utilize all the best policies of larger 401k plans such as auto-enrollment, escalation features and may include qualified default options like a target date fund.

This would be a boon to financial advisers.  Instead of having to manage dozens of smaller 401k plans, they would have a streamlined MEP.  This would lower start-up costs and leave the tricky stuff to the adviser and not the employer.  If and when a business gets large enough to venture out on their own, they already have someone to guide them along.

There are obstacles to overcome like employer match and whether it would be voluntary or not but there’s strong support for this type of plan.  Read the entire here and contact the experts at the IRA Financial Group with any questions you might have.

Nov 13

Super Storm Sandy to Increase Demand For Solo 401(k) Plan Loan Option

IRA Financial Group, the leading provider of IRS approved self-directed Solo 401(k) plans expects an increased demand from victims of Hurricane Sandy for the loan feature inherent in IRA Financial Group’s Solo 401K Plan. “By using the solo 401(k) plan loan feature, an individual can borrow up to $50,000 to help pay for damages caused by the super storm Sandy,“ stated Adam Bergman, a tax attorney with the IRA Financial Group. A self-employed or small business owner can take a solo 401k loan at any time using the accumulated balance of the solo 401k as collateral for the loan. A Solo 401(k) participant can borrow up to either $50,000 or 50% of their account value – whichever is less. This loan has to be repaid over an amortization schedule of 5 years or less with payment frequency no less than quarterly. The interest rate must be set at a reasonable rate of interest – generally interpreted as prime rate as per the Wall Street Journal. As of November 1, 2012, the Prime Rate is 3.25%. The Interest rate is fixed based on the prime rate at the time of the loan application. The solo 401k loan is received tax-free and penalty free.

“As a result of the recent enormous devastation caused by Hurricane Sandy, many Americans will need to access some of their retirement funds in order to help pay for some of the damage caused by the storm,” stated Mr. Bergman. “A self-employed individual will be able to borrow up to $50,000 of retirement funds tax and penalty free to help pay for any damages caused by Hurricane Sandy,“ stated Mr. Bergman.

The solo 401k or individual 401k plan loan feature is a perfect solution for any self-employed business owner seeking immediate funds to help pay for any damages caused by Hurricane Sandy. Solo 401(k) participants can borrow up to either $50,000 or 50% of their account value – whichever is less to help finance or operate their business. There are no penalties or taxes due provided loan payments are paid on time.

IRA Financial Group will take care of setting up the entire solo 401k plan and will assist with the completion of the loan process. The whole process can be handled by phone, email, fax, or mail and typically takes between 2-10 days to complete, the timing largely depending on the custodian holding the retirement funds. IRA Financial Group’s 401k experts and tax and ERISA attorneys are on site greatly reducing the set-up time and cost. Most importantly, each client of the IRA Financial Group is assigned a tax attorney to help with the establishment of the solo 401k business funding solution.

To learn more about the IRA Financial Group please visit our website at or call 800-472-0646 and don’t forget to follow us on Twitter!  @Bergman401k

Nov 09

Rolling Over the Right Way

According to Bob Carlson of, “One of the most important and fastest-growing transactions in personal finance is growing under the radar of most of the financial media and other observers. It and the follow-on transactions are critical to the financial lives of most Americans. Yet, people receive little guidance on the transactions and, as a result, frequently have thousands of dollars siphoned by taxes.”

The most common rollover is from a traditional 401k plan to an Individual Retirement Account (IRA).  There are other ones such as one 401k or IRA to another and defined benefit pension plan to an IRA, but the 401k to IRA is the one that will be utilized most, especially for baby boomers.

There are several options when leaving a job.  You can leave your money in your former employer’s 401k plan, an annuity option could be available, or you can just take a lump sum and not rollover.  However, most people’s best bet is to rollover into an IRA.  You may choose who will handle your money (someone with the best fees, investment options, etc.).  There will be more options on what to do with your money.  Finally, if you choose to leave your money in your old plan, you might not be aware of when changes are made to it…and that could cost you a ton of money.

Now that you have decided on a rollover, it’s time to start planning.  Don’t wait till after you retire, do your research in the months leading up to it.  Find out where you want your money to go and what kind of investments suit your needs.  When it’s time to transfer, make sure it’s a direct transfer from the 401k trustee to the IRA custodian (aka a trustee-to-trustee transfer).  This will avoid any unneeded  taxes and/or penalty possibilities.  There are no taxes on a properly completed transfer!

“To avoid taxes, the rollover must be of a “lump sum.” For a distribution to qualify as a lump sum, it must be of the entire account. In addition, the employee must be either “separated from service” of the employer or over age 59½. This means if you are under age 59½ and reduce your hours, a tax-free rollover might not be available,” adds Mr. Carlson.

Even if you are still working, you may want to rollover once you reach 59½.  Factors include fees, services offered and the want of an investment manager.  Check with your employer to see if this is available to you if you stay on the job.

For more info on rollovers, check out the full article here.

One last thing to consider is a self-directed IRA with checkbook control.  This allows you to be your own custodian.  The tax experts at the IRA Financial Group can help you decide which plan is best for you.  Give us a call at 800.472.0646 or visit our website at!

Don’t forget to follow us on Twitter as well!  @Bergman401k

Nov 07

Do You Have the Right Financial Advisor?

Saving for retirement is no easy task.  The investments are tricky, the laws are complicated and time is needed to pore through all the information available.  Most people don’t have the time to properly maintain their retirement planning.  This is where a financial advisor can help you.  However, if he or she is not competent, you’ll find yourself losing money big time, especially is he or she is only looking to make money for him- or herself.

“Let’s start by distinguishing between investment advisors and retirement planners. An investment advisor might be good at helping you decide what your asset allocation should be and selecting specific securities or mutual funds. They might also help you minimize income taxes on your investments. This may have been all the advice you really needed while you were growing your retirement nest egg.

But using your retirement savings to generate retirement income is more complex, and you’ll need a retirement planner who’s experienced with helping people decide which retirement income generator (RIG), or combination of RIGS, will work best for you.

To this end, look for an advisor with credentials that require substantial training and experience with financial planning. Examples include Certified Financial Planners (CFP), Chartered Financial Analysts (CFA), Certified Public Accountants – Personal Financial Specialists (CPA-PFS), and Chartered Financial Consultants (ChFC). These credentials all show evidence of training on a broad variety of financial planning topics”, says Steve Vernon at

Over at the IRA Financial Group, you can trust that our tax experts are fully qualified and that our clients always comes first.  We specialize in Solo 401(k) plans, self-directed IRA plans and Roth IRA plans among many others.  Give us a call today at 800.472.0646 and talk to one of them today.

Don’t forget to follow us on Twitter as well @Bergman401k and @IRAFG!